Great summary and detail. The Bank of International Settlements (BIS estb. 1930) has monitored central banking worldwide, and, recently, the VOLUNTARY reporting of hedge funds (which are completely unregulated). The ‘housing’ bubble which has served as the trigger for credit derivative exposure and potential default is by itself, small, but its repercussions are huge. The biggest bubble is the one Brown equates to Chernobyl, appropriately. During 2007 the bubble was being reported as about $470 trillion, growing 45% to the $681 trillion quoted by the end of 2007!! Now, just over a quarter later, a figure above $700 trillion is mentioned by many sources. A 5% failure rate of the $700 trillion (a modest assumption given some sources think 40% of hedge funds will fail in the near future) is about $35 trillion...there are zero takers for this debt. WIth credit contraction the short term (less than one year) rollovers are dependent on extremely low interest loans from Japan...’the carry trade’, which can be easily moderated by China, which, with huge US Forex reserves, can drive the yen up and reduce the carry trade and thus
‘expose’ derivative credit rollovers at will. The Fed Reserve is not ‘Federal’...it has essentially ‘no reserve’. Its got a few hundred million according to several sources, enough to bail out one more Bear Stearns event...and that is it. Browns piece here echoes many other similar pieces that are coming out whole, as hers, and in many pieces by others. Exciting time for financial writers and a nervous world with everything at stake.
I believe it is the people who created this nation and the system as it is today.
"We the People of he United States ..... do ordain and establish this Constitution for the United States of America."
yitbos